Finance Act , 1937

PART I. Income Tax.

1 Income tax and sur-tax for the year 1937-38.

1.—(1) Income tax shall be charged for the year beginning on the 6th day of April, 1937, at the rate of four shillings and sixpence in the pound.

(2) Sur-tax for the year beginning on the 6th day of April, 1937, shall be charged in respect of the income of any individual the total of which from all sources exceeds one thousand five hundred pounds and shall be so charged at the same rates as those at which it was charged for the year beginning on the 6th day of April, 1936.

(3) The several statutory and other provisions which were in force during the year beginning on the 6th day of April, 1936, in relation to income tax and sur-tax shall, subject to the provisions of this Act, have effect in relation to the income tax and sur-tax to be charged as aforesaid for the year beginning on the 6th day of April, 1937.

2 Provisions as to income settled on children.

2.—(1) Where, by virtue or in consequence of a settlement and during the life of the settlor, any income is, in any year of assessment, paid or payable or accumulated to or for the benefit of a child of the settlor, such income shall, if at the beginning of such year such child is under the age of twenty-one years and is unmarried, be treated for the purposes of the Income Tax Acts as income of the settlor for that year and not as income of any other person.

(2) Where by virtue of an irrevocable instrument property is vested in or held by trustees upon such trusts that, in any year of assessment, the next preceding sub-section of this section would (but for this sub-section) apply to the income of such property, the following provisions shall apply and have effect, that is to say:—

(a) the said next preceding sub-section shall not apply in respect of any part of such income which is, in the said year of assessment, accumulated for the benefit of a child (being a child who, at the beginning of such year, is under the age of twenty-one years and is unmarried) of the settlor nor in respect of income arising in the said year of assessment from accumulations of the income hereinbefore mentioned;

(b) whenever in any year of assessment beginning after the 5th day of April, 1937, any sum whatsoever is paid under the trusts of such irrevocable instrument out of such property or the accumulations of the income thereof or out of the income of such property or the income of the said accumulations to or for the benefit of a child (being a child who, at the beginning of such year, is under the age of twenty-one years and is unmarried) of the settlor, such sum shall be deemed for the purposes of this section to be paid as income, but subject to the limitation that this paragraph shall not apply to so much of such sum as is equal to the amount by which the aggregate of such sum and all other (if any) sums paid after the 5th day of April, 1937, under the trusts of such irrevocable instrument to or for the benefit of the said child or any other child (being a child who, at the beginning of the year of assessment in which such other sum was paid, was under the age of twenty-one years and unmarried) of the settlor exceeds the aggregate amount of the income arising after the 5th day of April, 1937, from such property together with the income arising after the said date from the said accumulations.

In this sub-section the word “property” does not include any annual or other periodical payment secured by the covenant of the settlor, or by a charge made by the settlor on the whole or any part of his property or the whole or any part of his future income, or by both such covenant and such charge.

(3) Where, by virtue of sub-section (1) of this section, any income tax or sur-tax becomes chargeable on and is paid by a settlor, such settlor shall be entitled to recover from any trustee or other person to whom the income is payable by virtue or in consequence of the settlement the amount of the tax so paid, and for that purpose to require the Revenue Commissioners to furnish to him a certificate specifying the amount of the income in respect of which he has so paid tax and the amount of the tax so paid, and every certificate so furnished shall be conclusive evidence of the matters of fact stated therein.

(4) Where a person obtains, in respect of any allowance or relief, a repayment of income tax in excess of the amount of the repayment to which he would, but for sub-section (1) of this section, have been entitled, an amount equal to the excess shall be paid by him to the trustee or other person to whom the income is payable by virtue or in consequence of the settlement and, where there are two or more such trustees or other persons, in such proportions as the circumstances may require.

(5) If any question arises as to the amount of any payment or as to any apportionment to be made under the next preceding sub-section of this section, such question shall be decided by the Special Commissioners, whose decision thereon shall be final.

(6) Any income which, by virtue of this section, is treated as income of any person shall be deemed to be the highest part of his income.

(7) No repayment shall be made under section 25 of the Income Tax Act, 1918, on account of tax paid in respect of any income which has by virtue of this section been treated as income of a settlor.

(8) As on and from the 6th day of April, 1937, paragraph (c) of sub-section (1) of section 20 of the Finance Act, 1922, and the subsequent provisions of that section in so far as they relate to the said paragraph (c) shall cease to have effect in respect of any settlement to which this section applies.

(9) This section applies to every settlement, wheresoever made or entered into and whether it was made or entered into before or after the passing of this Act.

(10) The following provisions shall apply and have effect in relation to the construction of the expression “irrevocable instrument” in this section, that is to say:—

(a) the said expression shall be construed as including instruments made before, as well as instruments made after the passing of this Act;

(b) an instrument shall not be an irrevocable instrument for the purposes of this section if the trusts thereof provide for all or any one or more of the following matters, that is to say:—

(i) the payment or application to or for the settlor for his own benefit of any capital or income or accumulations of income in any circumstances whatsoever during the life of a child of the settlor to or for the benefit of whom any income or accumulations of income is or are or may be payable or applicable under the trusts of the instrument;

(ii) the payment or application during the life of the settlor to or for the wife or husband of the settlor for her or his own benefit of any capital or income or accumulations of income in any circumstances whatsoever during the life of any such child as aforesaid of the settlor;

(iii) the termination of the trusts of the instrument by the act or on the default of any person;

(iv) the payment by the settlor of a penalty in the event of his failing to comply with the provisions of the instrument;

(c) an instrument shall not be prevented from being an irrevocable instrument for the purposes of this section by reason only that the trusts thereof include any one or more of the following provisions, that is to say:—

(i) a provision whereunder any capital or income or accumulations of income will or may become payable to or applicable for the benefit of the settlor, or the wife or the husband of the settlor, on the bankruptcy of a child of the settlor to or for the benefit of whom any income or accumulations of income is or are or may be payable or applicable under the trusts of the instrument;

(ii) a provision whereunder any capital or income or accumulations of income will or may become payable to or applicable for the benefit of the settlor, or the wife or the husband of the settlor, in the event of any such child as aforesaid of the settlor making an assignment of or charge on such capital or income or accumulations of income;

(iii) a provision for the termination of the trusts of the instrument in such circumstances or manner that such termination would not, during the life of any such child as aforesaid of the settlor, benefit any person other than such child or his or her wife, husband, or issue.

(11) In this section—

the word “child” includes a stepchild, an adopted child, and an illegitimate child;

the word “settlement” includes any disposition, trust, covenant, agreement, or arrangement, and any transfer of money or other property or of any right to money or other property;

the word “income” (except where it occurs in the expression “income tax” and where, in sub-section (1), paragraph (b) of sub-section (2), and sub-sections (6) and (7), it is immediately preceded by the word “as” or (in the said sub-section (6)) by the word “his”) includes any income chargeable to income tax by deduction or otherwise and any income which would have been so chargeable if it had been received in Saorstát Eireann by a person resident or ordinarily resident in Saorstát Eireann but does not include income arising under a settlement in a year of assessment for which the settlor is not chargeable to income tax as a resident in Saorstát Eireann.

3 Amendment of section 39 of the Income Tax Act, 1918.

3.—Sub-section (2) of section 39 of the Income Tax Act, 1918, shall be construed and have effect as if the words “eighty pounds a year by way of annuity” were substituted therein for the words “fifty-two pounds a year by way of annuity”.

4 Carrying forward of losses in certain cases.

4.—(1) Where—

(a) a loss sustained by a person has been carried forward under section 14 of the Finance Act, 1929 (No. 32 of 1929), and

(b) owing to the allowance (under Rule 6 of the Rules applicable to Cases I and II of Schedule D of the Income Tax Act, 1918) in the assessments for the six years next following the year in which such loss was sustained of deductions for wear and tear of machinery or plant, a deduction or set-off cannot be given under the said section 14 in respect of such loss or a part thereof from or against the profits or gains on which such person is assessed under the said Schedule D for the said six years,

then and in such case, so much of such loss as represents the amount thereof in respect of which relief was not given but could have been given were it not for the allowance aforesaid shall be further carried forward and deducted or set-off under and in accordance with the said section 14, with the modification that, for the purpose of such further carrying forward, the words “the six following years of assessment” shall be deemed to be deleted from sub-section (1) of the said section and the words “all subsequent years of assessment” to be substituted for the words so deleted.

(2) The same deduction for wear and tear of machinery or plant to which effect is given in any year of assessment shall not be taken into account more than once for the purposes of this section.

(3) Any relief given under the said section 14 of the Finance Act, 1929, (otherwise than by virtue of this section) from an assessment shall be given in respect of a loss sustained in a year within the six years immediately preceding the year of assessment before any relief is given by virtue of this section in respect of a loss sustained in a year not within those six years.

(4) This section shall be deemed to have come into operation on the 6th day of April, 1936, and shall have and be deemed to have had effect as on and from that date.

PART II. Customs and Excise.

5 Imposition of duties in the First Schedule.

5.—(1) There shall be charged, levied, and paid on every of the articles mentioned in the second column of the First Schedule to this Act imported into Saorstát Eireann on or after the 15th day of April, 1937, a duty of customs at the rate stated in the third column of the said First Schedule opposite the mention of the article in the said second column.

(2) Where a percentage is stated in the third column of the First Schedule to this Act opposite the mention of any article in the second column of that Schedule, such statement shall be construed as meaning a rate of duty equal to that percentage of the value of such article.

(3) Wherever it is stated in the fourth column of the First Schedule to this Act that the licensing provision applies to a particular duty mentioned in that Schedule, the following provision shall apply and have effect in relation to that duty, that is to say—whenever the Minister for Finance, after consultation with the Minister for Industry and Commerce, so thinks proper, the Revenue Commissioners may by licence authorise any particular person, subject to compliance with such conditions as they may think fit to impose, to import without payment of the said duty any articles chargeable with the said duty either, as the Revenue Commissioners shall think proper, without limit as to time or quantity or either of them or within a specified time or in a specified quantity.

(4) Subject to the provisions of the next preceding sub-section of this section, the provisions (if any) set forth in the fourth column of the First Schedule to this Act at any reference number in that Schedule shall have effect in respect of the duty mentioned at that reference number.

6 Alteration of duties on sugar.

6.—(1) In lieu of the present customs duties, drawbacks, and allowance in respect of sugar, molasses, glucose, and saccharin, there shall be charged, levied, and paid in respect of all sugar, molasses, glucose and saccharin imported into Saorstát Eireann on or after the 1st day of June, 1937, the customs duties specified in the second column of Part I of the Second Schedule to this Act, and there shall be paid and allowed in respect of all sugar, molasses, glucose, and saccharin so imported the drawbacks and allowance set out in Part II of the said Second Schedule.

(2) In lieu of the present excise duties, drawbacks, and allowances in respect of sugar, molasses, glucose, and saccharin, there shall, as on and from the 1st day of June, 1937, be charged, levied, and paid in respect of all sugar, molasses, glucose, and saccharin made in Saorstát Eireann the excise duties specified in the third and fourth columns of Part I of the Second Schedule to this Act and there shall be allowed and paid in respect of all sugar, molasses, glucose, and saccharin so made the drawbacks and allowances set out in Part II of the said Second Schedule.

(3) Section 40 of the Finance Act, 1932 (No. 20 of 1932), shall apply in relation to the customs duties imposed by this section in like manner as the said section applies in relation to the duties mentioned therein.

(4) The provisions contained in Part III of the First Schedule to the Finance Act, 1925 (No. 28 of 1925), shall apply in relation to the duties, drawbacks, and allowances imposed or allowed by this section in like manner as those provisions apply in relation to the duties, drawbacks, and allowances mentioned in the said First Schedule, but with and subject to the following modifications, that is to say:—

(a) in clause 5, the 1st day of June, 1937, shall be substituted for the 6th day of May, 1925;

(b) in clause 7, the reference to sections 26 and 27 of the said Finance Act, 1925, shall be construed as a reference to this section.

(5) Section 25 of the Finance Act, 1931 (No. 31 of 1931), shall apply in relation to the duties, drawbacks, and allowances imposed or allowed by this section in like manner as it applies in relation to the duties, drawbacks, and allowances mentioned therein.

7 Duty on personal clothing and wearing apparel.

7.—(1) In lieu of the duty imposed by section 10 of the Finance Act, 1934 (No. 31 of 1934), a duty of customs shall be charged, levied, and paid—

(a) on every of the articles (whether completely or partially manufactured) mentioned in the second column in Part I of the Third Schedule to this Act (other than articles to which the said Part I is stated at the head thereof not to apply) imported into Saorstát Eireann on or after the 15th day of April, 1937, at the rate (save as is otherwise provided by this section) stated in the third column of the said Part I of the said Third Schedule opposite the mention of the article in the said second column, and

(b) on every component part of any article (other than an accessory of any personal clothing or wearing apparel) mentioned in the second column in Part I of the Third Schedule to this Act which is imported into Saorstát Eireann on or after the 15th day of April, 1937, at the rate (save as is otherwise provided by this section) at which duty is stated in the third column in the said Part I to be chargeable on the article of which such component part is a component part, and

(c) on every of the articles mentioned in the second column in Part II of the Third Schedule to this Act imported into Saorstát Eireann on or after the 15th day of April, 1937, at the rate stated in the third column of the said Part II opposite the mention of the article in the said second column.

(2) In the case of the several articles mentioned in the second column in Parts III and IV of the Third Schedule to this Act and to which the said Parts are respectively stated at the head thereof to be applicable (including, in the case of articles mentioned in the said Part III, partially manufactured articles and, in the case of articles mentioned in the said Part IV, incomplete articles), duty at the rate stated in the third column in the said Part III or the said Part IV (whichever is applicable) opposite the mention of the article in the said second column shall be the minimum duty chargeable by virtue of this section in respect of each such article, and accordingly the duty imposed by this section shall, in respect of every such article, be charged at whichever of the following rates produces in each particular case the greater amount of duty, that is to say, the rate chargeable in respect of such article under Part I or Part II (as the case may be) of the said Third Schedule or the rate chargeable under whichever of Parts III and IV of the said Third Schedule is applicable to such article.

(3) The statement of a percentage in the third column of the Third Schedule to this Act opposite the mention of any article in the second column of that Schedule shall be taken and construed as meaning a rate of duty equal to that percentage of the value of such article.

(4) Whenever the Revenue Commissioners are satisfied that any article chargeable with the duty imposed by this section is imported for use exclusively in a stage play or other dramatic or musical representation or performance, they may, subject to compliance with such conditions as they may think fit to impose, permit such article to be imported without payment of the said duty.